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How Large Companies Can Innovate

Peter Diamandis   |   February 20, 2013    1:45 PM ET

In this blog, I am going to show you how one GE exec (at GE HealthCare Hungary) figured out how to instill a sense of creative freedom among the employees that led to a real burst in innovation.

Dr. Lajos Reich was an Executive Participant in a recent Singularity University session. When he told me his story of spurring innovation at his division at GE Healthcare Hungary, I literally booked an interview with him the next morning at 6 a.m. so that I could capture his story for my book "BOLD" and for this blog. I thought his story was THAT important for you to hear.

Lajos Reich is currently GE Healthcare's Chief Technology Officer in Hungary. On his way to this position, he worked at chief technologies at a small Connecticut firm specializing in lighting, then onto GE facilities in Cleveland, Ohio, Bangalore, India and, ultimately, Budapest.

"I learned a lot," he says. "First of all, the difference between leading a small company versus a large company. In a large corporation it's hard to be nimble, because people are so hard-pressed to do their work, and they're often kept isolated in their own departments or on their own projects, without interacting."

"When I returned to Hungary to take the CTO position, my goal was to foster greater teamwork -- literally to institute a complete cultural transformation."

Since his arrival in 2008, Lajos has not only increased the number of employees at that GE division by 50 percent, he has also dropped the company's attrition rate from 15 percent to 2 percent. Better than that, under his leadership, GE Healthcare is now responsible for generating 20 patents per year, which is more than any other company in the country. So how did he do that?

"Innovation is a modality," he says. "Before, my teams were separate. A big part of the change was to move them closer so they could learn from each other. "Here are the two principal things that I did," he says:


  1. "First, I started to host a technology symposium every year for all the engineers where they could hear across the divisional lines what they were all up to. Before, since teams did not work together very often, there was a tendency to reinvent the wheel." At last year's symposium 200 engineers gave 54 presentations. "This knowledge-sharing opportunity was so popular that I started a monthly technical seminar series, where people present their work to other GE engineers in a deeper context."

  2. "Second, I was actually inspired by your X PRIZE, and I wanted to create a competition to foster creativity. I was also inspired Google's 20 percent time, where they give each employee 20 percent of their time to innovate, no strings attached. So I ended up doing a combination of both in a very risky fashion," he says.


"I decided to create a competition for best innovation, with the prize being a 64G iPad (which, in fact, equaled around one month extra net salary for an average engineer). Rather than offering 20 percent more time, I offered people an entire week to do with as they wished. They could go to the beach, or shopping or even stay at home -- or they could work on an invitation and enter the competition. It was totally up to them.

"Engineers always complain that they do not have time to innovate. That there's too much documentation. They tell me that 80 percent of their time is spent on documenting rather than creating. So in this one-week competition I said: 'No documentation; just focus on creating and innovating. Do whatever you want. If you want to use your time to develop a prototype, great.' I gave them access to every resource and didn't disturb them with any last-minute meetings. They were totally free."

Lajos had conducted this experiment in innovation without letting his supervisors know and, should it have been a failure, he could easily have been sacked, he says. But the results were staggering.

The upshot: No one took any time off to go shopping or to the beach. The engineers formed 13 groups and came up with 13 different prototypes. Lajos created a one-day symposium to present the ideas. The management team selected the top three for awards, and six of the 13 have led to patents, with one or two of those products actually likely to become a marketable product for the company.

Many companies would not take the risk of giving engineers a whole week to innovate, Lajos says, "but a concentrated time does make a difference. They are not taken out from the flow of the idea, they can fully concentrate on it."

In my next blog I'm going to explore Lajos' steps for unleashing creativity.

NOTE: Over the next year, I'm embarking on a BOLD mission -- to speak to top CEOs and entrepreneurs to find out their secrets to success. My last book Abundance, which hit No. 1 on Amazon, No. 2 on the New York Times and was at the top of Bill Gates' personal reading list, shows us the technologies that empower us to create a world of Abundance over the next 20 to 30 years. BOLD, my next book, will provide you with tools you can use to make your dreams come true and help you solve the world's grand challenges to create a world of Abundance. I'm going to write this book and share it with you every week through a series of blog posts. Each step of the way, I'll ask for your input and feedback. Top contributors will be credited within the book as a special "thank you," and all contributors will be recognized on the forthcoming BOLD book website. To ensure you never miss a message, sign up for my newsletter here.

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Unleashing Innovation to Save Our Oceans

XPRIZE   |   January 25, 2013    1:25 PM ET

2013-01-25-Bob_Weiss.jpgBy Robert K. Weiss
Robert K. Weiss is the Vice Chairman and President of the X PRIZE Foundation.

Rapid acidification of our oceans presents a challenge well suited for utilizing the incentivized competition methodology to crowdsource the genius required to create the solutions sorely needed before it's too late.

Our beautiful Blue Planet has another problem with acid in its waters. In the 1980s, "acid rain" was contaminating lakes and rivers across the Northeast. Eventually, a joint effort across state lines helped develop new air-quality standards, smokestack scrubbers and other improvements to avert the crisis, returning the region's water systems to viability.

Scientists have begun sounding the alarm bell that we have a much bigger and more complicated issue developing with water becoming more acidic, this time in our oceans. As reported last Fall in a Los Angeles Times article ("A sea change to ocean chemistry," Oct. 7, 2012), many of the world's top ocean scientists gathered in Monterey, CA recently to discuss the growing evidence of ocean acidification. The news is not good.

In the last 150 years or so - since the beginning of the industrial revolution - our oceans have become about 30% more acidic. And what this means to life in the oceans is potentially disastrous: corals and mollusks have more difficulty making shells, plankton at the base of the food chain become less viable, and whole ecosystems are potentially threatened. But as the scientists in Monterey noted, we are only just beginning to understand these impacts; and worse still, we're only beginning to understand the extent of acidification itself.

2013-01-25-Coral_SXC.jpg

To respond, we'll need new approaches that can leap across jurisdictions and scientific disciplines, bringing together experts and resources from many institutions and organizations to think how best to solve what could become a huge problem for us all. It is clear that change is already occurring. The 500 billion tons of carbon dioxide deposited in our oceans since the beginning of the Industrial Revolution are making seawater more acidic, already affecting life in cold-water areas such the Pacific Northwest. Without change, one researcher says, by century's end our oceans will be "hot, sour and breathless."

The problem is big and complex. Our knowledge of the issues is imperfect. We know that increased carbon dioxide is a driving cause, because as CO2 is absorbed by water, it forms carbonic acid. (Think of how sweet a flat soda is: the CO2 that makes it bubble also provides the acid that counteracts the sweetness. CO2 in your soda makes it taste right but in the oceans it increases acidity.)

So, what needs to be done? It starts with substantially increasing our knowledge. 70% of the globe is covered by oceans. Dealing with acidified oceans across the entire globe is considerably more complicated than dealing with acid rain in one region of one country on one continent. Thankfully, we have some time before the full brunt of this massive problem hits. Focused research now can lead to better research in the future that will lead to comprehensive solutions to this massive challenge.

As we have done successfully in diverse areas from space flight to oil cleanup, an incentivized competition could drive privately funded research and result in innovative, orthogonal solutions.

Reducing carbon dioxide deposition is the long-term key to stabilizing the pH of the oceans. But how we get there is a very big question. It will require novel solutions from many areas of research. The leveraged incentivized competition methodology can unlock exponential growth in technologies, stimulating solutions to complicated, seemingly intractable problems. It is the X PRIZE Foundation's stock in trade.

The X PRIZE Foundation is mobilizing to attack ocean acidification. With the generous support of Wendy Schmidt, we will be launching a global competition for the development of effective and affordable pH sensors to profoundly improve our knowledge of ocean chemistry and the understanding of the global effects of ocean acidification.

This significant improvement in technology can help scientists begin to answer critical questions about our oceans: Where are the impacts of acidification the greatest? Which ecosystems are most at risk? How does the CO2 driving acidification circulate around the world's oceans? What capacity do the oceans have to deal with this change?

If the ocean dies, the planet dies. Practical answers to this problem can be found with a well designed and curated competition that will unleash the innovators. Let's make it happen. We can't afford not to.

Visit X PRIZE at xprize.org, follow us on Facebook, Twitter and Google+, and get our Newsletter to stay informed.

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